Below is an excerpt from a Charles Hugh Smith essay. I’m terribly afraid that he’s right, that our best and brightest Ivy League fools are at it again. I played a small role in their last horror show, and the flashbacks just keep coming: Afghanistan = Cambodia; Goldman Sachs = Gulf of Tonkin. On and on. Once more we see that intelligence and wisdom are not at all the same thing.
When I see Treasury Secretary Geithner justifying the stupendous bailouts of Wall Street and the squandering of taxpayer funds, I conclude he knows he’s lying and deceiving the public — but he apparently thinks that is the only way to persuade the public to bail out Wall Street.
In other words, the U.S. public cannot be trusted with fixing the structural flaws in the U.S. economy and financial system (after all, the public might — gasp! — demand the destruction of the money-center and investment banks) so we have to manipulate them into going along with our plan to save Wall Street and the money-center banks.
Just like in Vietnam, the first step is to scare the bejabbers out of the public: the financial system was moments away from crashing, which would have impoverished every last one of you, not just now, but forever and ever.
There is also a domestic political motivation. President Johnson often obsessed over how his Democratic Party would suffer domestic defeat if he were perceived to have “lost Vietnam” to the Communists. (Never mind Vietnam was arbitrarily divided after World War Two.) Thus winning the war “in the hearts and minds” of the American public was Job One — the actual war could be lost, but it needed to be lost without appearing to be lost.
This is a process otherwise known as “peace with honor.”
Now we find ourselves swamped by relentless waves of financial propaganda, spin, manipulation and bogus statistical “proof” (a.k.a. body count redux) that the “war” on the bad old recession has been “won.”
What a domestic political catastrophe for the ascendant Democrats if they failed to “win the war on recession.” Thus creating the perception that the war has been won is absolutely more important than actually dismantling the Wall Street/money-center banks cabal which created the precarious debt/derivative machine and profited most handsomely from it.
I predict we will get our financial Tet Offensive in 2010. That’s when the propaganda that “the recession is over” will be revealed as a lie foisted on the public “for our own good.” And just as in the Vietnam Era, the American public will lose whatever trust and confidence they once had in their government and its leaders, elected and appointed.